A Surat Thani native, Khun Natthinon Tutthammarong, or Mr Non, came to Phuket in 1987 looking for work. He quickly found a job as a car salesman, first working for Nissan and then Volvo. But it wasn’t until he started working at Mercedes-Benz that his life took an unexpected twist.
Clients trading-in their used Mercedes opened-the-door for him to the used car market in Phuket and it wasn’t long before he understood the business and had gotten to know the local dealership owners.
He saw the potential in opening his own dealership but lacked the capital needed to start. Continuing at Mercedes-Benz, he earned the distinction of being the first sales person from Thailand to receive training in Germany and as his reputation as a trusted salesman grew, so too did his client list.
It was a turn of events in 2005 that would ultimately give him the money he needed to start-up on his own. Still working at Mercedes-Benz, Mr Non innocently purchased a BMW for his own personal use. This action resulted with him getting fired - which he felt was wrong - and after seeking legal help, the courts agreed and he was awarded with enough funds to start his own dealership.
Starting with a small lot near Supercheap, his previous clients soon found out where he was and it didn’t take long before he was trading in mostly European and luxury used cars. The business grew and in 2012 he moved to a bigger custom-built showroom on the corner of a busy junction.
That same year the previous Thai government rolled-out the first car scheme for new car sales, essentially slashing the price of smaller new vehicles by around 20%. Initially this had very little effect on the used car market says Mr Non, but then at the beginning of this year business started to decline and it hasn’t stopped.
The economic problems facing the region, including the decline in tourism revenue and the low market price for rubber, along with the current state of domestic auto industry means hard times for Mr Non and other used car salesman.
“I don’t think the used car business is going to be as good and wonderful as 4 or 5 years ago” he says, admitting he’s struggling to keep his business afloat. It’s a similar story for other local dealerships – they’ve either had to adapt, by offering other services such as car cleaning, tuning, repairs or close down, which has happened to a number of the smaller dealerships.
Other changes taking place in Thailand’s used car industry hold yet more uncertainty for independent dealerships. Toyota are already selling used cars alongside their new car showrooms with other brands expected to follow suite.
Thanachart, one of the biggest car financing companies in Thailand, are launching their own dealerships nationwide as is Gulliver – a Japanese used car giant who have ambitious franchising plans for their Thailand expansion.
Despite all the current problems and the uncertain future, Mr Non remains optimistic for the next year. “We have a lot of hope that in the coming year the tourism business will improve and then the business owners will come and buy cars again”.
Mr Non is not alone in his current circumstances, there are multitudes of other local businesses all feeling the pinch of the region’s economic troubles. We will have to wait and see if his wishful aspirations of the returning tourism dollar will be fulfilled.
Richard Jones is the Managing Director of BuyCar24 and can be contacted through www.buycar24.com/en/